Buying a home can be problematic for any generation. Millennials face not just a unique set of problems but they can bring a unique set opportunities for real estate industry. Their segmented employment ratios within this generation go from such extremes as high paying jobs in the tech, to unemployed with bad credit. As we roll into 2015 there are numerous predictions of how these millennials will tackle real estate investing. Will we continue to see commercial real estate grow or will family homes prices rise or fall. It is anyone’s guess.
There are many challenges for new home buyers from getting the financing to the shrinking inventory of homes in population centers like San Diego and Los Angeles.
Below is a news article from the Las Vegas review journal outlining the how millennials will affect the home buying market and the general landscape of real estate in 2015. What happens in Las Vegas may prove to be a model of what the rest of the country will experience.
Why millennials will make it easier for you to buy a house | Las Vegas Review-Journal
“Millennial” is almost a buzzword now. Everyone wants to know what this generation is doing — or take a shot at assuming. As Gen Y begins to age, it’s natural to wonder how this generation’s mindset will affect aspects of our economy, from the job force and investing to homeownership.
According to Gino Blefari, CEO of HSF Affiliates LLC, the operator of Berkshire Hathaway Home Services, Prudential Real Estate and Real Living Estate franchise networks, there might be setbacks, but millennial’s will be an important segment of the real estate market in coming years:
“Millennials will impact the home ownership landscape,” Blefari said. “There’s no doubt first-time buyers were impacted by the tighter lending requirements in recent years, and as home prices continue to rebound, some of those first-time buyers who don’t have the equity of another home to help with a down payment were squeezed out. However, this generation still very much believes in home ownership.”
Debt is one factor that will delay homeownership for many millennials. The average student who graduated from college in 2013 with student loans walked away with $28,400 in debt, according to the Institute for College Access & Success’ Project on Student Debt; and the story isn’t much better for older millennials. A 2012 study by Young Invincibles found that then 30-year-olds who graduated in 2004, on average, were likely ineligible for a mortgage due to poor debt-to-income ratios. Even if this weren’t a metric lenders used, student loan obligations are preventing many from building the savings needed for a home down payment.
Everyone wants to know what this generation is doing or take a shot at assuming. As Gen Y begins to age, it’s natural to wonder how this generation’s mindset will affect aspects of our economy, from the job force and investing to homeownership. Many argue that homeownership will end with millennials.